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Local partners key for Mart Resources to tap into Nigerian oilJunior oil and gas player Mart Resources (MMT.TO 1.4 0.00 0.00%) isn’t shying away from potential challenges associated with its West African oil reserves. The company is focused on the rich, proven and undeveloped oil fields in Nigeria, an area that has been plagued by political strife since the beginning of the Biafran War in 1967. Wade Cherwayko, Chairman and CEO of Mart Resources says his company is finding success in the country through strong ties to local groups. “In order to be allocated in some of what we call the preferential rights you have to form a partnership with an indigenous group,” he said in an interview with BNN. “A lot of the assets that are allocated are proven and undeveloped, and by law a foreign company is not allowed to have a direct allocation of those assets. You have to have a local partner.” In addition to complying with government mandates, Cherwayko says the local groups are an asset to navigating both business and cultural issues that may arise from having significant operations in a foreign country. “In addition to having these local partners as part of a government requirement on those licenses, having a local partner is important when you’re working in a challenging environment like Nigeria,” he says. “They know the law, they know the lay of the land, they can help with community issues and help make your operations go a lot smoother.” The West African country’s strong track record of rich oil fields that have already been identified was a key factor in attracting Mart Resources to begin operations in the country. “Nigeria is a very interesting country where there are a lot of proven undeveloped oil fields, it’s estimated there’s about 2 billion barrels of oil that have been discovered by the majors throughout the years,” Cherwayko says. Taking advantage of the underutilized but proven reserves has proved a boon for Mart Resources, as exploration costs are reduced by knowledge of the existing wells. “Under these indigenous programs working with local companies we’re unlocking a lot of the value in these proven fields,” Cherwayko says. “We went into our first field there over five years ago, we reentered an existing well that was drilled in 1974, started production from that well at 2,200 barrels a day, to date that well is still producing at 2,000 barrels a day.” Total production in Nigeria is capped at 13,000 barrels per day for Mart Resources, due to pipeline constrictions in the area. “Over the last few years, we’ve been embarking on a new pipeline … which will tie into another export facility and we expect our production will go from 13,000 barrels a day to over 30,000 barrels a day at year end,” Cherwayko says. “As you can see, there’s substantial increase in production.” According to Cherwayko, Nigeria will continue to be Mart Resources’ main focus for development and growth. “There’s a lot of upside in this,” he says. “It’s a challenging environment but there’s significant upside.” http://www.bnn.ca/News/2014/9/16/Local-partners-key-for-Mart-Resources-to-tap-into-Nigerian-oil.aspx |
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Msg # | Subject | Author | Recs | Date Posted |
12448 | Re: Local partners key for Mart Resources to tap into Nigerian oil | goldiehawn | 1 | 9/17/2014 9:56:32 AM |